Welcome to European Tribune. It's gone a bit quiet around here these days, but it's still going.

Major Intellectual Property Rulings by SCOTUS

by Laurent GUERBY Tue May 1st, 2007 at 06:13:04 AM EST

The KSR ruling is IMHO a common-sense law-and-economics analysis of the extraordinary bending of patent law by CAFC, USPTO and corrupt attorneys on the "non-obviousness" criteria. The KSR court ruling is unanimous and by far the most talked about. I'm saying "law-and-economics" because the court is citing "market forces" many times in its ruling, and remind everyone that a patent regime that is blocking progress is unconstitutionnal.

The rulings:

Linkfest and quotefest below.


Today, the US Supreme Court held, unanimously, than the specialised CAFC patent court had been bending patent law and as a consequence, retarding progress.

Now, why is this relevant to plans to create a single European patent court? Perhaps it's partly because the patent industry is firmly in control of patent policy in Europe, as it was in the US before these rare SCOTUS decisions. Perhaps it's because a single court means a single law, and the basis for that law is likely to be the twisted EPO interpretation of the EPC, an interpretation that over a fifteen years corrupted the essence of the patent convention until banned subject matter like software became a prime hunting for the patent lawyers. This happened in the States, no surprise it would happen here too.

But above all these reasons, the really terrifying aspect of the EPLA proposals is simply this: there is no equivalent to the US Supreme Court. Yes we have a European Court of Justice, but it is firmly excluded from any competence over the emerging EU patent system.

Think of it for a second... a system with all the flaws of the US system, and none of the correcting mechanisms. A lot of lawyers are going to make a killing in Europe's high-tech sector. High-five, it's Lawyers Gone Wild vol.16!!

KSR Int'l Co. v. Teleflex Inc. (unanimous court) :

(page 11) We begin by rejecting the rigid approach of the Court of Appeals.

(page 11) the need for caution in granting a patent based on the combination of elements found in the prior art.

(page 13) When a work is available in one field of endeavor, design incentives and other market forces can prompt variations of it, either in the same field or a different one. If a person of ordinary kill can implement a predictable variation, section 103 likely bars its patentability. For the same reason, if a technique has been used to improve one device, and a person of ordinary skill in the art would recognize that it would improve similar devices in the same way, using the technique is obvious unless its actual application is beyond his or her skill.

(page 14) Often, it will be necessary for a court to look to interrelated teachings of multiple patents; the effects of demands known to the design community or present in the marketplace; and the background knowledge possessed by a person having ordinary skill in the art, all in order to determine whether there was an apparent reason to combine the known elements in the fashion claimed by the patent at issue. To facilitate review, this analysis should be made explicit. As our precedents make clear, however, the analysis need not seek out precise teachings directed to the specific subject matter of the challenged claim, for a court can take account of the inferences and creative steps that a person of ordinary skill in the art would employ.

(page 15) The obviousness analysis cannot be confined by a formalistic conception of the words teaching, suggestion, and motivation, or by overemphasis on the importance of published articles and the explicit content of issued patents. The diversity of inventive pursuits and of modern technology counsels against limiting the analysis in this way. In many fields it may be that there is little discussion of obvious techniques or combinations, and it often may be the case that market demand, rather than scienfitic literature, will drive design trends. Granting patent protection to advances that would occur in the ordinary course without real innovation retards progress and may, in the case of patents combining previously known elements, deprive prior inventions of their value or utility.

(page 17) A person of ordinary skill in the art is also a person of ordinary creativity, not an automaton. The same constricted analysis led the Court of Appeals to conclude, in error, that a patent claim cannot be proved obvious merely by showing that the combination of elements was "obvious to try." When there is a design need or market pressure to solve a problem and there are a finite number of identified, predictable solutions, a person of ordinary skill has good reason to pursue the known options within his or her technical grasp. If this leads to the anticipated success, it is likely the product not of innovation but of ordinary skill and common sense. In that instance the fact that a combination was obvious to try might show that it was obvious under §103.

(page 17) Rigid preventative rules that deny factfinders recourse to common sense, however, are neither necessary under our case law nor consistent with it.

(page 24) And as progress beginning from higher levels of achievement is expected in the normal course, the results of ordinary innovation are not the subject of exclusive rights under the patent laws. Were it otherwise patents might stifle, rather than promote, the progress of useful arts.

Microsoft Corp. v. AT&T (Justice Stevens dissenting, Justice Roberts took no part) :

(pages 9 and 10) Abstract software code is an idea without physical embodiment, and as such, it does not match S271(f)'s categorization: "components" amenable to "combination" ...

(page 11) The distinctions advanced by AT&T do not persuade us to characterize software, uncoupled from a medium, as a combinable component. Blueprints too, or any design information for that matter, can be independently developed, bought and sold. If the point of AT&T's argument is that we do not see blueprints lining stores' shelves, the same observation may be made about software in the abstract: what retailers sell and consumers buy, are copies of software.

(page 15) The presumption that United States law governs domestically but does not rule the world applies with particular force in patent law.

We of course in Europe inherited this disease, read the FFII president quote above.

French version on my blog

Display:
Thanks for this...and especially for all the resources you provide. Does this mean that the internet can't be patented??

"Once in awhile we get shown the light, in the strangest of places, if we look at it right" - Hunter/Garcia
by whataboutbob on Tue May 1st, 2007 at 08:08:08 AM EST
The internet, like everything under the sun, is already patented.

:)

Patent statistics:

http://www.uspto.gov/go/taf/us_stat.htm

So about 3 millions live patents in the USA in 2006. Each patent use convoluted language over several pages.

If you want to do business in the USA, you have to make sure you don't infringe any of these patents. Not one of them.

And business complain about state regulations?

Total state regulation is peanuts against patents.

by Laurent GUERBY on Tue May 1st, 2007 at 08:58:23 AM EST
[ Parent ]
http://www.scotusblog.com/movabletype/archives/2007/05/patent_law_afte.html


Although the Roberts Court was supposed to render unanimous decisions providing clear guidance, it often has failed to realize this goal. In yesterday's KSR decision, however, the Court found that unanimity and fundamentally altered the patent landscape. Rejecting the rigid approach developed by the Federal Circuit on obviousness, one of the most important aspects of patent law, the Court instructed that "common sense" cannot be ignored in determining the validity of patents and emphasized patent law's goal of rewarding true innovation.

The KSR decision asserts the Supreme Court's authority over patent law more clearly and aggressively than any case to date. KSR does not simply require the Federal Circuit to adhere to the obviousness standard it recognized in Graham and leave it at that, as last Term's eBay decision did in leaving the shape and impact of the new standard for injunctions to the lower courts to decide. Nor does KSR adopt a bright line rule that the Supreme Court easily could administer. Instead, KSR admonishes the Federal Circuit against using rigid rules and imposes a flexible standard, and then applies the standard to the facts of the case so as to leave no doubt about its application. Thus, the Supreme Court's unanimous decision suggest that the Court plans to require the Federal Circuit to apply a flexible standard and to scrutinize how that standard is applied, at least on an occasional basis.

The practical impact of KSR will be immediate and broad. Numerous patents will now be open to challenge on obviousness grounds, and a substantial number of those may invalidated. In light of the Supreme Court's rejection of the conclusory expert testimony in KSR, many obviousness challenges will be resolved on summary judgment. And by making it clear that obviousness must be judged under a flexible standard, the Supreme Court has limited the ability of the Federal Circuit to control how the PTO and the district courts apply this standard.

The impact of KSR is likely to be particularly great with respect to business method patents, particularly those that simply translate a technique used in brick & mortar retailing onto the Internet. It also may have a great impact in the high tech industry, where numerous incremental patents have been issued that are often used to extort settlements companies with complex products that allegedly use such patents. Finally, it will affect so-called patent trolls, especially those who buy up dubious patents in hopes of leveraging them into lucrative settlements.
[...]

by Laurent GUERBY on Tue May 1st, 2007 at 08:59:56 AM EST
Thanks for diarying this. I'm starting to wonder if the FFII is the greatest lobbying organisation that ever was.
by nanne (zwaerdenmaecker@gmail.com) on Tue May 1st, 2007 at 11:12:58 AM EST
FFII was certainly the first EU grass-root to launch a successful attempt at stopping a EU directive.

I doubt there will be another success.

by Laurent GUERBY on Wed May 2nd, 2007 at 02:37:09 AM EST
[ Parent ]
Why not?
by nanne (zwaerdenmaecker@gmail.com) on Wed May 2nd, 2007 at 04:35:53 AM EST
[ Parent ]
The EU Commission learned the lesson?

Bush is a symptom, not the disease.
by Migeru (migeru at eurotrib dot com) on Wed May 2nd, 2007 at 04:38:18 AM EST
[ Parent ]
The question is, what lesson? They're still trying all kinds of back doors and proposing all sorts of other Directives to increase IP protection.
by nanne (zwaerdenmaecker@gmail.com) on Wed May 2nd, 2007 at 05:05:45 AM EST
[ Parent ]
The lesson of how to protect future directives from grass-roots lobbying.

Bush is a symptom, not the disease.
by Migeru (migeru at eurotrib dot com) on Wed May 2nd, 2007 at 05:07:58 AM EST
[ Parent ]
We'll see about that :-)
by nanne (zwaerdenmaecker@gmail.com) on Wed May 2nd, 2007 at 05:09:28 AM EST
[ Parent ]
Yes and IPRED2 passed first reading with worsening amendments.

Why it won't happen again? Because first one surprised professional lobbyists.

Now there is no more surprise and people involved on the grass root side have all realized when reading the proposed EU constitution that it was hugely worsening the situation and that future was near hopeless so they're no longer putting a huge fight.

You can't reasonably fight as grass root against more than one IP idiotic directive per year.

by Laurent GUERBY on Wed May 2nd, 2007 at 04:08:51 PM EST
[ Parent ]
I think to stop the lunacy we must build a political movement that includes strong criticism of IP, and challenge established parties for their seats. Wheter this movement is or simply includes the Pirate parties is yet to be seen. Norwegian Venstre (european liberal) recently copied and translated (paragraph by paragraph) Piratpartiets policy on copyright and then (with some small adaptions) included it in their political platform. That is a hopeful sign that we will not have to build Pirate parties in every country to affect change.

AFAIK all swedish euro-parlamentarians voted no on IPRED2. I do not think it is a coincidence that they are well aware that Piratpartiet will be running in 2009. This will be an issue and they prefer not to loose votes on what (from their perspective) is a marginal issue.

And thanks for this diary.

Sweden's finest (and perhaps only) collaborative, leftist e-newspaper Synapze.se

by A swedish kind of death on Wed May 2nd, 2007 at 05:53:42 PM EST
[ Parent ]
The Constitution also went down, as you'll remember.

You may be right about the limited stamina of the grassroots, the Surveillance Directive passed pretty much without a fight after the battle against the Software Patents Directive was won.

I don't think the amendments of the EP made IPRED2 worse, by the way. They made it less bad. But the best thing would be not to have the Directive in the first place.

by nanne (zwaerdenmaecker@gmail.com) on Thu May 3rd, 2007 at 05:49:34 AM EST
[ Parent ]
What a wealth of information. Thanks for this great diary.  
by kellogg (kellogg[dot]david[at]gmail[dot]com) on Tue May 1st, 2007 at 11:33:39 AM EST
I'm sure there was much rejoicing in the halls of the US Patent Office as well.  They now have a stronger tool to reject patent applications.  It's obvious!

This ruling is a double-edge sword, of course, as inventors now will have an even harder time protecting their inventions.  Once again, it will be the big corporations who will benefit from the reduced competition.

by Foraker on Tue May 1st, 2007 at 07:14:53 PM EST
According to one, there are not that happy:

http://just-n-examiner.livejournal.com/19163.html

Patent examiner, what a job... The civil servants in charge of deciding in place of the free market what is a "good" idea and what is a "bad" idea. Thought police.

by Laurent GUERBY on Wed May 2nd, 2007 at 02:35:50 AM EST
[ Parent ]
I suspect I am in the peculiar position of finding IP law and practice much more reasonable than, for example, real-estate. A person "owning" rights to the product of her work and imagination seems ever so much more defensible than a person "owning" rights to a spot of land that has undoubtedly been violently seized many times from its prior inhabitants.
by rootless2 on Wed May 2nd, 2007 at 11:11:53 PM EST
[ Parent ]
My objection is that while "property" deals with scarce objects and their distribution (and thus in some form is quite unavoidable), IP creates scarcity by outlawing use of information. So do you also find it reasonable to create scarcity in order for certain persons to control the rights to the product of her work and imagination?

Sweden's finest (and perhaps only) collaborative, leftist e-newspaper Synapze.se
by A swedish kind of death on Thu May 3rd, 2007 at 09:44:38 AM EST
[ Parent ]
Money is artificially scarce. Credit, citizenship, and stocks are artificial articles that confer power on some people. Why is it moral for Donald Trump to inherit real-estate and for an abstraction like Elf-Acquitine to "own" rights to oil in Nigeria, but immoral for an inventor to "own" rights to the product of her labor?

The whole "scarcity" argument of the Free Software people is unbearably dishonest.

by rootless2 on Thu May 3rd, 2007 at 01:21:59 PM EST
[ Parent ]
Yes, money is artificially scarce, but the things represented by it is scarce for real.

Why is it moral for Donald Trump to inherit real-estate and for an abstraction like Elf-Acquitine to "own" rights to oil in Nigeria,

It is not.

but immoral for an inventor to "own" rights to the product of her labor?

Ah, come on. Like IP is something that benefits inventors and not huge companies. I must have missed that when huge corporations and associations for corporations loobied IPRED2 through the European parliament.

Sweden's finest (and perhaps only) collaborative, leftist e-newspaper Synapze.se

by A swedish kind of death on Thu May 3rd, 2007 at 03:46:46 PM EST
[ Parent ]
No. The things represented by money are not necessarily scarce. Europe, US, Australia, and Canada all need vast government programs to reduce grain surplus, yet people starve for lack of money to buy bread.

But if you are against all ownership, you have a rational point of view, just not one with much chance of success. If, on the other hand, you think that investors should be able to earn "interest" on "money", but musicians should not be able to own performances, you have position that Rupert Murdoch would like, but not one that I find reasonable.

In the US, still, some inventors make money from IP just as some musicians do. I am personally in favor of Yo Yo Ma being wealthy and independent thanks to his "ownership" of recordings instead of having to put his hat on the street corner.

by rootless2 on Thu May 3rd, 2007 at 05:35:38 PM EST
[ Parent ]
Grain is scarce especially if you wuold like to run cars on them. Europe, US, Australia, and Canada makes it more so to drive up the price.

If you can make a living on performances you have no problem with or without IP, though you are better of without. Live performances are more popular then ever at the same time as record companies are having troubles. Artists generally get a much greater cut of profits from live performances then records so this benefits artists. People generally has a limited budget for music and other cultural activities and downloading music frees more money for conserts as well as gives opportunities for easier discovery of new bands.

Most inventors work for big companies so the IP rights of their work belong to the big company anyway. But I won´t deny that there are a few musicians and inventors who benefits from the system. Though the big beneficiaries are the huge corporations that keep pushing for more IP rights. It would be to obviously selfserving if they said so so they prefer to hold up the poor musician and lone genius inventor instead.

But since you hold no love for these huge corporations I guess you simply think it is better with a system that benefits a few on the expense of the many? Even if it incidentally benefits these huge corporations the most?

Sweden's finest (and perhaps only) collaborative, leftist e-newspaper Synapze.se

by A swedish kind of death on Thu May 3rd, 2007 at 06:33:12 PM EST
[ Parent ]
If you can make a living on performances you have no problem with or without IP, though you are better of without.

This is the opinion of the ex-programmers who are politicians, but musicians do not agree.

To me, "free IP" is merely a variation of "free trade" - another scam advertised as idealism.

by rootless2 on Thu May 3rd, 2007 at 06:58:21 PM EST
[ Parent ]
You might then want to note that "free trade" and "more IP" is marketed by the same forces.

For example was TRIPS promoted as part of "free trade" and opposed by those opposing "free trade".

Sweden's finest (and perhaps only) collaborative, leftist e-newspaper Synapze.se

by A swedish kind of death on Thu May 3rd, 2007 at 09:01:00 PM EST
[ Parent ]
Not really. Corporations don't have a single agenda. For example, Google versus Verizon on net neutrality. Bayer and Axel Springer have very different concerns on IP.
by rootless2 on Thu May 3rd, 2007 at 09:52:06 PM EST
[ Parent ]
You're wrong, big corporations all want more IP for obvious reasons.

Look at the EU patent directive: not one big business talked against it. Zero.

How's that coherent with your view?

Only SME went to the fight, but commission listen only to big business and not to innovative SME.

by Laurent GUERBY on Sat May 5th, 2007 at 03:03:50 PM EST
[ Parent ]
Do I find it reasonable to create scarcity? Yes, I am no saint and our world economy is based on creating scarcity. Do you think it is immoral to restrict employment to union members? IP is a labor benefit and I am in favor of skilled labor.
by rootless2 on Thu May 3rd, 2007 at 03:09:47 PM EST
[ Parent ]
Do you think it is immoral to restrict employment to union members?

Yes, and we have no such laws in Sweden.

Sweden's finest (and perhaps only) collaborative, leftist e-newspaper Synapze.se

by A swedish kind of death on Thu May 3rd, 2007 at 03:48:07 PM EST
[ Parent ]
Well you are consistent: temp work, employment at will, no IP. Sounds like Von-Mises utopia.
by rootless2 on Thu May 3rd, 2007 at 05:14:35 PM EST
[ Parent ]
Who said anything about temp work and employment at will?

I think it is a bad strategy to restrict employment to union members if that is what you are fighting. Then you will create a division among workers. I think it is much better to go for the law and get rid of employment at will.

Sweden's finest (and perhaps only) collaborative, leftist e-newspaper Synapze.se

by A swedish kind of death on Thu May 3rd, 2007 at 06:37:01 PM EST
[ Parent ]
Ok, this is just as good an example. To say one has a right to a salary and can only be deprived of it by some quasi judicial procedure confers on that person ownership of some completely artificial legal fiction. Our Von Misean friends (who like academic tenure it turns out) will point out that there is no scarcity of work, just an artificial scarcity created by Sweden's intrusive employment laws which prevent Latvians from taking jobs from Swedes. There is no difference between requiring that employers have a duty to pay salary and requiring that listeners to a recorded performance pay the artist.
by rootless2 on Thu May 3rd, 2007 at 07:04:01 PM EST
[ Parent ]
Have you ever been to Sweden?

Don't fight forces, use them R. Buckminster Fuller.
by rg (leopold dot lepster at google mail dot com) on Thu May 3rd, 2007 at 07:08:11 PM EST
[ Parent ]
(Sorry, I was just wondering.  Maybe you live there...no offence meant.)

Don't fight forces, use them R. Buckminster Fuller.
by rg (leopold dot lepster at google mail dot com) on Thu May 3rd, 2007 at 07:08:41 PM EST
[ Parent ]
Never been there.
by rootless2 on Thu May 3rd, 2007 at 07:18:55 PM EST
[ Parent ]
I do not follow your example at all. You say (that our Von Misean friends says) scarcity of work is created by law? Do you mean employment or labour?

Their is a scarcity of labour, as there is a limited number of people on this planet. Latvians can move to Sweden to work because they are within the EU. Few do however as most employments demand that you speak fluent swedish.

Employment is scarce if the economic system makes it so.

There is no difference between requiring that employers have a duty to pay salary and requiring that listeners to a recorded performance pay the artist.

Yes there is. In the first case A has to pay B for B to do something, in the second A has to pay B for A to be allowed to do something.

On the other hand:

There is no difference between requiring that readers of a written text pay the writer and requiring that listeners to a recorded performance pay the artist. So in accordance with your reasoning that would be a euro, thank you.

Sweden's finest (and perhaps only) collaborative, leftist e-newspaper Synapze.se

by A swedish kind of death on Thu May 3rd, 2007 at 07:20:49 PM EST
[ Parent ]
http://www.thelocal.se/article.php?ID=698&date=20041202

As for employment, I think you are being evasive. Abolition of employment at will is a legal grant of an "ownership right" to employees.

Do you also think that publishers should be able to make copies of authors books without paying them?

by rootless2 on Thu May 3rd, 2007 at 07:27:25 PM EST
[ Parent ]
Yes, there is collective bargaining in Sweden.

The rights regarding employment are rights, but I do not se it as similar to ownership right, unless you want to make all rights similar. You can of course call the right to free speach an "ownership right" if you like but I fail too see the relevance.

Do you also think that publishers should be able to make copies of authors books without paying them?

For their own personal use? Yes.

To sell, I think there should be a limited period of revenue-sharing with the author, before they pass into public domain. Just as today, though I also believe that the current time of liftime + 70 years is extremely excessive.

Actually I think that revenue-sharing is the right way to understand a reasonable copyright. And when there is no revenue stream, as in if I email you a song or text, there is no percentage. Back up some time and that was the way copyright was understood.

I note that we are getting quite off the original topic which was patents.

Sweden's finest (and perhaps only) collaborative, leftist e-newspaper Synapze.se

by A swedish kind of death on Thu May 3rd, 2007 at 08:18:45 PM EST
[ Parent ]
But very enjoyable to read!

Don't fight forces, use them R. Buckminster Fuller.
by rg (leopold dot lepster at google mail dot com) on Thu May 3rd, 2007 at 08:31:27 PM EST
[ Parent ]
Similarity has nothing to do with it. By definition ownership is the legal right to use or possess some "thing". Clearly, abolition of employment at will grants the job holder ownership of a salary and provides a method for revoking that ownership. The US courts, for example, have held that academic tenure of the sort so prized by Neo-liberal economists is a property right. One cannot consider freedom of speech to be a property right.

The intellectual objection I have to the argument you and others make on this subject is inconsistency. If you accept the modern world economy in which one can buy and sell bets on the gradients of price changes of options to purchase shares of companies that exist only to trade similar rights as "property" and where the economic value of such unfair and arbitrary "things" as holding an EU passport or a collective bargaining agreement are as solid as gold coins, then it is inconsistent to find rights to performance or inventions unethical.

The political objection is that your program essentially makes writers, musicians, inventors, and others into wage employees of publishers and distributors. I think that Merck should have to pay royalties to Amazonian indian tribes who discover medical herbs and Siemens should have to pay royalties to Serbian inventors who figure out how to make motors run on alternating current and that Yo Yo Ma should be able to live on royalties instead of following the tradition of begging royalty.

by rootless2 on Thu May 3rd, 2007 at 09:46:34 PM EST
[ Parent ]
The intellectual objection I have to the argument you and others make on this subject is inconsistency.

This is a strawman but you are probably not aware of it. There is no "the argument you and others make on this subject" against IP as well as there is no "the argument you and others make on this subject" pro IP.

If I am inconsistent with others is of little concern to me.

Sweden's finest (and perhaps only) collaborative, leftist e-newspaper Synapze.se

by A swedish kind of death on Thu May 3rd, 2007 at 09:52:28 PM EST
[ Parent ]
The key difference on IP is "rival" vs "non rival".

If I eat your apple, you don't have any apple left.

If I copy your song or invention, you still have it.

If your read the USA constitution you'll see that IP is clearly defined as optional, IP may be created by congress only under certain condition, that is to say increase progress.

 And the KSR ruling is clear on it: if the patent regime does not promote progress, it is unconstitutionnal in the USA period. Same thing for copyright.

by Laurent GUERBY on Sat May 5th, 2007 at 03:11:29 PM EST
[ Parent ]
I wish they would just call it what it is:  intellectual Enclosure.

The difference between theory and practise in practise ...
by DeAnander (de_at_daclarke_dot_org) on Wed May 2nd, 2007 at 08:02:53 PM EST
That is a good analogy in some respects, but remember that the Enclosure movement pushed landless tenants from the domains of their feudal lords. IP is like many forms of property, a double edged sword.
by rootless2 on Wed May 2nd, 2007 at 11:02:15 PM EST
[ Parent ]
We misunderstand "Property" by conceiving of it as an "Object" when it fact it is a bundle of rights of use and "ownership".

And we are used to an unbridgeable divide between these rights of absolute ownership and temporary use: Freehold and Leasehold; the debate concerning "fair use" of proprietary IP and so on.

In both the case of land and IP I am pointing out that by using simple new legal forms other than private Companies for the purpose of "packaging" Property rights it is possible to come up with new partnership-based policy options that are capable of completely changing the game.

ie put IP into a "trust" (the IP Foundation?)with the trustee/custodian as a member of a partnership with:
(a) the IP creator;
(b) the IP user;
(c) a Manager/Developer/Operator.

The revenues - if there are any (and many IP creators choose not to charge) - are simply shared proportionally between the IP creator and the Manager/ Operator (if any).

It's not difficult. But it IS new. Neither Proprietary nor "Open", but both.

A partnership model which is "closed" in that only Members may use IP but "Open" in that anyone who consents to the terms of the partnership agreement may join.

"The future is already here -- it's just not very evenly distributed" William Gibson

by ChrisCook (cojockathotmaildotcom) on Thu May 3rd, 2007 at 03:25:46 AM EST
[ Parent ]
I largely agree, but it is fascinating that the "progressive" point of view follows the old Tory line that the only actual property is real-estate and that mere tradesmen should not be impertinent enough as to demand property rights.
by rootless2 on Thu May 3rd, 2007 at 01:50:12 PM EST
[ Parent ]
Chris, I was there!  I wrote and wrote and then pfff!  I was staring at another diary and 'twas all gone.  My property!

So...

Property in it's common meaning is "What I own and you do not, unless you own it with me."

(Or some part of it, which can be decided in law.)

But we make the association: Property = those "things"

The house (which will one day crumble and be buried--or destroyed in some way--as they always have been and always will be)...is...there!  There it is!  That's property!

Yes, yes.  It is exclusive ownership over time.

Why would I want to own this....thing?  (Picks up ming vase and stares at it.)

Because it has value.

Sez who?

Sez the guy who puts his flowers in it.

But (edit edit!) we can't just get ever more stuff.  Where would we keep it?  How are we going to move it around?

We need other people--to look after it, to polish it, move it around.

And if we don't want it any more ("One day I just thought, 'Ming vase--flowers, it's not working'"), we can leave it by the roadside where it, too, will crumble, be covered in dust or be destroyed.

Or!  We could pass it onto someone else, for some o' that lovely liquid money that gets you different stuff, all kinds of different stuff.

Now: some stuff is not for sale.

What about if someone (;) bought Mt. Everest and refused to give anyone else the "right to roam"?

Well, this person would, if they had the power to back up their claim, "own" that land...until they died, lost the power, or changed their mind in some way.

So...(it wasn't any better the first time):

What you "own" must have value, if you wish to

a) benefit from it yourself (value to you)

and/or

b) are willing to allow another person to benefit from it (value to someone else)

...I had it: an LLP involving eco-builders, land owners, residents, all the way to the energy company who would join as a member and would agree to put up a wind turbine and there would be an agreement, as part of the LLP about the financing.

....but you need initial value to take part.  And I had a thought: seven billion people, most active through the day.  Is all that activity grounded in value?  Coz I had an image of a bubble of activity collapsing...and it needs to collapse onto something valuable.

So Property = What's mine (or ours.)
Ownership = I have (incl. legal; esp. legal in some environments) the power to do what I want with my property
Value = the benefit adhering to the property for the owner and/or anyone else
Money = liquidity.  The ability to obtain valuable property.

Where property can mean "A beatiful view"; "peace and quiet"; "whisky sour"; "the northern lights"...

...yes, because they are "yours"!

...ah yes, and the point being that a tree is not "yours"; it is itself, as are the stones in a brick dwelling themselves.

Life just "is" (as they say); as humans we see value as we live...here there and everywhere.

But if we can't access this value (I can see the food, but I can't eat it)...we don't have the initial value necessary to...join an LLP.

The LLP presupposes that all parties agree where the initial value(s) lie(s).  Just as in your tale well told of the Jersey solicitors.  They knew where the value lay.

Hey, I'm a yacking!

So...

The word "wrapper" makes me think of sweets, and my experience is that all you find inside is a piece of not particulary interesting chocolate.  Shell sound hard, and reminds me of computer "shell" programmes (?)...

...the LLP is an opportunity to share your valuable property with others in such a way that you don't necessarily need outside agents as intermediaries, and yet your agreements are "in law".  Yes, someone can default--to the value of the assets they have (legally) brought to the LLP.

Hold on up a sec thar!

"the value of the assets"

....I mean, they can lose all of the valuable things they offer to the LLP if they fuck it over, and no more.

But as I see it right now, you need the LLP as and when you have financial agreements...because the asset most people know how to value is "money"--coz it's a changeling and we can see it in action.  Ten grand is...measurable (A trip round the world; a chunk of the mortgage; lossa lossa beers [I knew a guy many years ago who got a £6,000 inheritance; I believe he spent all of it on, yes, drink and drugs, and clubs and buying everyone loads of drink and drugs])

So the hard part is how to perceive the value of objects that can't easily be seen in terms of "money".  But surely they can--"value" can be measured by price.  If you were to sell it, how much would you get for it?  But ah, ah.  Hmmm.

Your models are business/economic models; sober judgements.  Ya know, I'm hoping the enterprises you do go well.  But I see a wider application--it's the legal aspect.  I don't know much (about economy)...the law.  But I see that we all need protection from it and by it.  Ergo, Holmes, they should be cheap (£20); easy to set up, with no I-need-a-lawyer smallprint (is that possible when setting up a legal document?  Seems to be with wills, apart from the witnessing and sealing...whatever goes on)

And the advantages for individuals in building a legal element into their associations.

What's to lose if you don't?  Where's the loss?  (Clear in the case of the Jersey solicitors--were they solicitors?)

What are my/our tangible benefits?  What protections am I afforded above and beyond simple "trust" relationships?  ("Sure I lent him a few hundred.  I had it spare and he's good for it.")

But no, I want to keep away from money.  That's too narrow.  Most people (looking around globally) don't have enough.

But something of value...do all humans have something of value they can place with an LLP?  What benefits acrue--beyond not having to pay some tax and not having to stump up any payments to intermediaries where and when they are not needed?

Don't fight forces, use them R. Buckminster Fuller.

by rg (leopold dot lepster at google mail dot com) on Thu May 3rd, 2007 at 08:14:19 PM EST
[ Parent ]
 But something of value...do all humans have something of value they can place with an LLP?

Indeed they do. They have their ideas and their writing, music, painting and so on: which is what this thread is about.

They also have the use over time of their brain, brawn and accumulated skills and experience.

I would advocate a new approach to the financing of education.

Every student should be able to enter into a mini-partnership with the State - an "Enterprise Agreement" I call it.

Provided the student is suitably qualified for it (ie through ok school exams) the State "invests" as "Capital Partner" in (say) my qualification as a Doctor.

It's not a loan, so that I don't HAVE to pay it back, but in return for the use of the "Investment" I have (say) 2% of my gross salary deducted and this goes into the education pot.

If I like, I can pay the State back, (either as an interest-free loan, or maybe at an agreed multiple of my earnings) and so if I've paid off half, then the "Capital Rental" comes down to 1% of my revenue.

So the more that Society has invested in you, the more you give back. But it's not a debt, hanging around your neck like an albatross: you only need pay if you are earning.

And maybe if you do a few years overseas on VSO - probably getting twice as much experience as you would get in the UK - the government credits your account as though you were earning double....

Lots of new policy options.

In fact I believe that there is NO area of policy which cannot be improved upon using an "Open Corporate" as a policy tool.

The LLP is the first example of an "Open Corporate", but with the addition of a protective coating (or semi-permeable membrane!) - ie "limitation of liability" - a privilege for which LLP members (like shareholders in a Ltd company) don't actually pay anything.

Reinvent marriage, divorce, wills and family law?

Welcome to the Family Corporate. I know someone who formed a husband and wife LLP the day after he heard me talk about the one I'm doing. (except mine will have the kids in it as well)

Reinvent Pensions?

Signor Tonti had the right idea - we simply reinvent Tontines in a big way using an "Open Corporate" linking together everyone born in the same year inot Cohort "Pools" of pension Investment Capital.

Reinvent taxes?

1/ Everyone pays x% of their earned income into a "Pool" and its redistributed equally. ie those earning less than average receive a net transfer.

2/ Everyone pays x% of the Value of the Commons to which they have exclusive rights into another Pool, and that is redistributed equally, too.

And so on.

I'm really getting into the rg stream of consciousness style - you should patent it!

"The future is already here -- it's just not very evenly distributed" William Gibson

by ChrisCook (cojockathotmaildotcom) on Fri May 4th, 2007 at 03:48:08 AM EST
[ Parent ]
rg stream of consciousness LLP!

I definitely prefer semi-permeable membrane (!)

It has a science edge--for those who don't know what it means, it'll sound like cells and biology (I don't think that'll put people off, though I may be wrong.)

For those who do know, there's the click: Ah!  So I am protected from what's coming in but not blocked in what I put out.

If that's the idea.

I like your education idea, but (not a nasty but) your larger ideas involve govt. spending, and I reckon that'll only happen when regions have demonstrated functionality, and that'll only  happen when municipalities demonstrate functionality...and that all sounds like a big pile of bureaucrats acting as fingernails down a board...screeee breaking.  Though you seem to be in contact with more...hmmm...enlightened local authorities, so good luck with that and I look forward to hearing the outcome(s).

I'm not so sure about this:

They have their ideas and their writing, music, painting and so on: which is what this thread is about.

They also have the use over time of their brain, brawn and accumulated skills and experience.

Can we deal with seven billion songs, books, and paintings?  Is it feasible to make an economy around that sort of activity?

Also: I'm thinking of the poor git who's grown up in an orphanage near a slum not far from a war zone; not the brightest eyed but the one who never really "got it", doesn't have much brawn, and has only really accumulated negative experiences...and no pratical skills (no teachers.)

...so they could write a novel!  And yes, maybe we do need seven billion stories...'twould be better than bombs.

But...yes.  Semi-permeable membrane.  In your examples there is always a "rich investor" of some kind who sees the enlightened path.  In education: the state.  With taxes: the state (via laws); the Jersey businessmen--all rich (enough.)

I think Miguel said (maybe someone else too? HiD?) that it assumes benevolence on the part of the investor, who could make alternative investments.

I'm wondering: what about a group of people, ya know, people who don't have access to a prinicpal (=rich) investor.  Something like, say, a bunch of people who have a website, where you have input value, the value of brains learning over time, tech. skills, there's writing, music, photography (no doubt there are some painters too.)

But no huge wodge of investment.  So, this website, well, we're thinking about the future, crazy solutions alien to current practice.  So let's call this website.  I know.  ET!  

So, let's take "ET".  What benefits would acrue to the various members if they agreed to associate within the semi-permeable membrane?

One benefit: limited liability.  But as the value being cannot be expressed in liquid money--there is no "key investor", only equals, sorta like the solicitors but without the suits, the legal practices, and the immediate vision of financial gain through tax breaks...  So, what is the liability an ET member might face outside the LLP, and how is it limited by us being within the semi-permeable membrane?

Don't fight forces, use them R. Buckminster Fuller.

by rg (leopold dot lepster at google mail dot com) on Fri May 4th, 2007 at 05:23:43 AM EST
[ Parent ]
The principal liability faced is probably that of libel/ lawsuits.

To me an LLP is just a simple (and optimal, since it is entirely "open") legal wrapper for "pooling" risk and reward, but has the attraction that it can operate across borders better than anything else - a "Legal XML".

"Law is Code" / Semantic Web, yada yada.

An example of crossborder operation is a Microfinance Initiative I am working on (saw a Norwegian junior minister about it last week: it's all ready part-funded by Norway) where we are setting up "Trustee"/ Custodian entities in each jurisdiction, which will be members of a "Development Network" LLP (or - more comprehensibly to Joe Public) an "Ethical Equity/Stock Exchange".

The other members of this LLP are a "Club" of Investors; the "Club" of Users of Investment; and the "Operating Member" consortium.

No reason why ET LLP couldn't use a variation of what is IMHO an optimal generic structure.

ET "Founder"/ Trustee Member
ET User Club
ET Financier Club
ET Service Provider Club

With costs shared as may be agreed, a suitable "core" governance probably convening online etc etc I'm sure it's all been covered before, but I've forgotten what was said!

"The future is already here -- it's just not very evenly distributed" William Gibson

by ChrisCook (cojockathotmaildotcom) on Fri May 4th, 2007 at 05:56:20 AM EST
[ Parent ]
Not to toot my own horn, but see this discussion of the different kinds of ET "stakeholders".

Bush is a symptom, not the disease.
by Migeru (migeru at eurotrib dot com) on Fri May 4th, 2007 at 06:13:17 AM EST
[ Parent ]
THAT was the fella!

I might have known.

"The future is already here -- it's just not very evenly distributed" William Gibson

by ChrisCook (cojockathotmaildotcom) on Fri May 4th, 2007 at 06:31:43 AM EST
[ Parent ]
Toot away!  That was an excellent piece of work and I thank ye for it!

Don't fight forces, use them R. Buckminster Fuller.
by rg (leopold dot lepster at google mail dot com) on Fri May 4th, 2007 at 07:24:29 AM EST
[ Parent ]


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